Tourism Victoria has used a new Bollywood film to promote Melbourne to the Indian audience.

The key scenes of the film, 'Run Milkha Run' ('Bhag Milkha Bhag') will be shot in the Australian state, Premier Ted Baillieu said.

The movie tells the story of Indian sporting hero Milkha Singh, known as the Flying Sikh, who launched his international running career at the 1956 Melbourne Olympic Games and went on to win 77 of 80 international races.

The film, featuring Bollywood actors Farhan Akhtar and Sonam Kapoor, in the lead, will generate more than 1 million-dollar in local economic activity when it is shot in Melbourne for two to three weeks, Baillieu said.

He also revealed that Film Victoria would continue working with the film's producers to support production while Tourism Victoria would use the film to promote the state.

"India is one of the busiest film production destinations in the world, and its burgeoning film industry offers vast opportunities for Victorian co-production projects, building on our strengths in the creative arts," the Herald Sun quoted Baillieu as saying.

"As with other Indian films shot in Melbourne ... 'Bhag Milkha Bhag' will raise our profile in India and showcase Victoria as a great tourism destination.

"Tourism Victoria will leverage the release of the movie through a marketing campaign in India featuring the key locations from the film," he added.